The Medicare Annual Coordinated Election Period (ACEP) is the most crucial time of year for Medicare beneficiaries to make decisions about how they wish to receive their Medicare coverage. This year the Administration seems to be actively promoting Medicare Advantage plans. However, at the same time that this steering toward private plans is occurring, the Centers for Medicare & Medicaid Services (CMS) reported that Medicare Advantage provider directories contain extremely inaccurate information, which could lead beneficiaries to sign up for plans that might not actually include their doctors.

This is CMS’ third round of provider directory review since initially being alerted by a beneficiary complaint. CMS Examined 5602 providers and their listed locations from 52 different Medicare Advantage organizations between November 2017 and July 2018. Reviewers in the study called provider offices to verify the accuracy of the information in the provider directory. Information to be verified included names, address and phone numbers; whether the provider accepted the MA-PD in question at that location, and whether they accepted new patients with the MA-PD in question. CMS assigned each error a score, with incorrect locations, numbers and statements regarding accepting patients weighted highest.[1]

The CMS review found that:

Almost half (48.74%) had at least one inaccuracy.

Percentage of inaccuracies by MA organization ranged from 4.63% for the best network listing to 93.02% for the worst.

The majority of MA organizations had between 30% and 60% inaccuracies.

“Providers should not have been listed at 33.14% (3,481) of the locations…either because the provider did not work at the location or because the provider did not accept the plan at the location.”[2]

“85.64% of locations with deficiencies…had deficiencies of the highest weighted, most egregious errors.”[3]

41.75% of all locations listed had inaccuracies “with the highest likelihood of preventing access to care.”[4]

Beneficiaries and caregivers rely on provider directories to make important choices about their care. In this era of overt steering toward Medicare Advantage by the Administration[5], accurate information has never been more crucial. Errors in provider listings “create a barrier to care and raise questions regarding the adequacy and validity of the MAO’s network as a whole.”[6]

Despite these inaccuracies, according to the Washington Post, “[t]he Trump administration is holding off on punishing Medicare Advantage plans for error-ridden doctor directories — further evidence” that CMS “is showing special favor to the alternative program over traditional Medicare offerings.”[7] The Post continues: “Last year, the agency threatened to impose fines on the plans if they didn’t clean up their act. While this year’s report shows no substantial improvement overlast year (or the year before that), CMS isn’t following through on the threat [emphasis in original].”

December 26, 2018

Social Security might have a shot at surviving for another generation — and that’s thanks to 78.1 million individuals who will be contributing to it.

These 78.1 million individuals who come after millennials and were born after 1997 make up what is known as Generation Z.

Morgan Stanley says it is more optimistic about the impact of Generation Z than the Congressional Budget Office.

The Wall Street firm’s more bullish assessment on labor-force participation in particular means that its view of potential GDP by 2040 is above the CBO’s by 2.4% to 4.3%. Morgan Stanley says the CBO is understating potential labor force growth by between 0.2% to 0.3% per year in the 15 years through 2040.

While this may seem like a small variance, given that the continued funding of Social Security depends upon the number of people working, the variance has tremendous implications.

According to the Morgan Stanley report, the increase in the expected number of workers may allow Social Security to remain alive well beyond 2034.

If Morgan Stanley is right, the Social Security trust fund reserves may become depleted in 2062. It likely will delay the date of depletion for Medicare funds as well, the report said.

“Extending the deadline would likely push action off until the new depletion date, therefore removing the near- to medium-term prospects of raising the payroll tax, raising the taxable maximum to cover more or all earnings, raising the retirement age, and/or decreasing benefits,” the report says.

The most obvious benefit, the firm says, is the tailwind to sales growth. “To the extent the rise of Gens Y and Z in the labor force support a higher potential GDP growth rate in the U.S., this relationship would indicate a modestly higher potential longer-run growth rate for corporate sales and earnings,” the report said.

The last question is the easiest to answer; No. As long as Republicans control the Senate, where they increased their majority on Tuesday, and as long as President Trump remains in the White House, there is zero chance that Americans under age 65 will get access to Medicare.

What is Medicare for all?

But even answering the first question is complicated. It turns out that Medicare for all means many different things to different Democrats. Sometimes it doesn’t really mean Medicare. And it often doesn’t really mean for all.

Instead, the phrase has become short-hand for a wide range of ideas that really mean broader access to public insurance. But the design of that coverage is very different, depending on who you are talking to. The Kaiser Family Foundation has produced a very nice summary of the many plans here.

Start with the most far-reaching: Sen. Bernie Sanders (I-VT) plan to replace the entire health insurance system with a single public plan. No more employer-sponsored health coverage (which currently covers most Americans under age 65), no more Medicaid. No more ACA health exchanges for individuals. In fact, no more Medicare as we know it. Just a single government payer for all Americans, no matter their age.

Then there is what was called the “public option” during the debate over the 2010 Affordable Care Act. A Medicare-like public plan would be offered on the ACA marketplace alongside private insurance. Individuals and, in some bills, even employers, could purchase coverage. While some backers use Medicare to frame these plans (they are sometimes called Medicare Part E or Medicare-X), they really are not Medicare at all. Their benefits would be different and so would their premiums.

The third variation on the theme, which harkens back at least to the Bill Clinton Administration, is a Medicare buy-in. Unlike the other ideas, this really is Medicare—just made available starting at, say, age 50 or 55. Like today’s Medicare beneficiaries, enrollees could choose traditional Medicare, Medicare supplemental (Medigap) coverage, Part D drug coverage, or Medicare Advantage managed care. Unlike, the over-65 enrollees, younger buyers would pay premiums that would cover the full cost of benefits.

What will Democrats do?

My Urban Institute colleagues have estimated that a Sanders-like plan would increase public costs by $32 trillion over 10 years. We don’t know what the other ideas would cost, but presumably it would be much less.

Because health care coverage, especially for those with pre-existing conditions, was such an important campaign issue, House Democrats will have to do something once they gain control of the chamber in January. But what?

The most likely bill is something to protect the ACA from the Trump Administration’s regulatory efforts to dismantle it and the multiple state legal challenges that put it at risk. Even Senate Majority Leader Mitch McConnell says he is willing to work with Democrats to fix the ACA, though his definition of fix and theirs may differ.

But the ACA never promised true universal coverage. Including its expansion of Medicaid (which not every state accepted), the ACA reduced the share of the unisured to about 12.7 percent before Trump began scaling it back (the uninsured rate has since risen to 15.5 percent).

The 2020 fight

House Democrats will also try to protect current Medicare from any administrative efforts by the Trump Administration to scale back benefits. At the same time, there is a chance, however remote, that they may find a work together with Trump to reduce Medicare drug costs.

But all of that falls far short of Medicare for all—no matter what you think it means.

So what will newly empowered House Democrats do? My best guess is that they pass a relatively modest buy-in bill. Then, it dies in the Senate. And everyone fights about it all over again in 2020.

December 24, 2018

The Internal Revenue Service announced today the official estate and gift tax limits for 2019: The estate and gift tax exemption is $11.4 million per individual, up from $11.18 million in 2018. That means an individual can leave $11.4 million to heirs and pay no federal estate or gift tax, while a married couple will be able to shield $22.8 million. The annual gift exclusion amount remains the same at $15,000.

For the ultra rich, these numbers represent planning opportunities. For everybody else, they serve as a reminder: Even if you don’t have a taxable estate, you still need an estate plan.

The Trump tax cuts slashed the number of estates subject to the federal estate tax, by doubling the exemption amount from a base level of $5 million per person. So, there were only an estimated 1,890 taxable estates in 2018 (according to the Tax Policy Center). That compares with 4,687 taxable estates in 2013 reflecting a base $5 million exemption, and 52,000 taxable estates in 2000 when the exemption was $675,000 (Table 2, JCT 2015 Wealth Transfer Tax System Report).

For now, death tax foes are trying to make the new doubled exemption amounts permanent; the Trump tax cuts are scheduled to expire at year-end 2025. “Permanence [of the doubled exemption] would make the score of repeal much cheaper and provide predictability,” says Palmer Schoening of the anti-death tax Family Business Coalition, noting that the ultimate goal is still to repeal the estate tax. The mid-term elections, however, put a damper on the viability of Tax Reform 2.0, the Republicans’ latest push to make that doubled exemption permanent.

In the meantime, the wealthy will continue to plan around the estate tax, whittling down their estates with lifetime wealth transfer strategies to keep below the new threshold and avoid the 40% federal estate tax. Now, a couple who has used up every dollar of their exemption before the increase has another $440,000 of exemption value to pass on tax free. For planning tips, see Trusts In The Age of Trump: Time To Re-Engineer Your Estate Plan.

What about the $15,000 annual exclusion amount? You can give away $15,000 to as many individuals as you’d like. A husband and wife can each make $15,000 gifts. So, a couple could make $15,000 gifts to each of their four grandchildren, for a total of $120,000. Lifetime gifts beyond the annual exclusion amount count towards the $11.4 million combined estate/gift tax exemption. See The Gift Tax Return Trap And How To Avoid It.

Warning: The $22.8 million number per couple isn’t automatic. An unlimited marital deduction allows you to leave all or part of your assets to your surviving spouse free of federal estate tax. But to use your late spouse’s unused exemption – a move called “portability”—you must elect it on the estate tax return of the first spouse to die, even when no tax is due. The problem is if you don’t know what portability is and how to elect it, you could be hit with a surprise federal estate tax bill.

And note, if you live in one of the 17 states or the District of Columbia that levy separate estate and/or inheritance taxes, there’s even more at stake, with death taxes sometimes starting at the first dollar of an estate. Several states were in line to match the federal exemption amount for 2018, but state legislators determined the new doubled exemption was just too high. See States Rebel, Won’t Conform To Trump’s Estate Tax Cuts. Most states haven’t announced their inflation-adjusted numbers yet for 2019, but we’ll keep you posted.

December 24, 2018

WEDNESDAY, Nov. 28, 2018 (HealthDay News) — Fast tests designed to help primary care doctors rapidly spot dementia in their elderly patients often get it wrong, a new British report contends.

The finding concerns three widely used quick dementia tests: the “Mini-Mental State Examination” (intended to assess mental orientation and verbal memory); the “Memory Impairment Screen” (which tests verbal memory); and “Animal Naming” (which gives patients one minute to quickly name as many animals as they can).

The result: more than one-third of the patients were misclassified — as either having or not having dementia — by at least one of the rapid tests in question.

“Dementia can be difficult to accurately detect, particularly in a primary care setting,” said study lead author Janice Ranson. But the rapid tests “are important screening tools to help clinicians decide who is likely to benefit from further testing for dementia,” she acknowledged.

“Our results suggest that some of the misclassification is due to test biases, such as a patient’s age, ethnicity or education level,” she added.

Ranson is a doctoral researcher in clinical epidemiology at the University of Exeter Medical School in England.

She and her colleagues reported their findings in the Nov. 28 online issue of the journal Neurology: Clinical Practice.

Ranson said quick tests are “routinely used” by primary care doctors as an initial screening. And if signs of dementia are found, a “full dementia investigation” typically ensues.

The study included just over 800 patients in the United States who underwent the tests. The participants ranged in age from 70 to 110, with an average age of 82.

These comprehensive assessments revealed that about one-third of the patients had dementia.

All of the participants subsequently underwent each of the three quick dementia tests.

But when the research team compared the quick test results with the in-depth results, they found that 36 percent of the patients were mistakenly diagnosed by at least one of the quick tests.

Interestingly, the researchers found that individually, each quick test actually had a misdiagnosis rate of 14 to 21 percent, and only 2 percent of the patients were misdiagnosed by all three tests.

Why? Each test appeared to have a different problematic bias, the study authors said. For example, while one test appeared to underdiagnose dementia in highly educated patients, others appeared to miss the mark based on patient age, race or nursing home status.

“Each test is biased in different ways,” said Ranson, “and so some tests are more accurate than others for certain patient groups. While these results are at first concerning, knowing the specific limitations for each test will help clinicians decide which is the most appropriate for their patient.”

Still, she said there’s definitely room for improvement.

“We desperately need more accurate and less biased ways of detecting dementia swiftly in clinic,” said Ranson. “We are therefore developing new technology, using data science and artificial intelligence, to help clinicians get the best outcome for their patients. We are working hard to improve these tests with a more personalized approach to cognitive testing.”

Keith Fargo is director of scientific programs and outreach with the Alzheimer’s Association, in Chicago. “Diagnosing Alzheimer’s and other forms of dementia is an incredibly complex process, and not something that can be done on the quick,” he said.

“Simple cognitive tests can be a helpful first step toward diagnosis, but as the study points out, are imperfect,” Fargo explained.

“The Alzheimer’s Association supports efforts to better understand and account for potential biases in short assessments for cognitive impairment,” Fargo added. “Ensuring a timely and accurate diagnosis is critical, and this study identifies important biases that need to be considered when using these preliminary assessments.”

December 11, 2018

Almost twenty years after Maryland established Medicaid “home and community-based services” waiver programs designed to keep older Marylanders and Marylanders with disabilities in their own homes rather than in a nursing home, Marylanders are still unable to “age-in-place.” Maryland continues to underfund the Maryland Medicaid Home & Community-Based Options Waiver, despite the program’s over 22,000-person, eight-year waiting list. Not only are many Marylanders unable to get the services they want and need to continue living at home, Maryland fails to save millions of dollars that can be realized by adopting a strong policy of avoiding unnecessary nursing home admissions.

December 11, 2018

This article and the accompanying chart were originally published in 2016 by Joanne Marcus, MSW, and Theresa M. Varnet, MSW, JD.The 2018 updates were provided by Karen Dunivan Konvicka, JD.

The ABLE Act allows an individual with a disability to have a tax-preferred savings account without jeopardizing his or her Medicaid and SSI eligibility. See a comparison chart of ABLE accounts and trusts at the end of this article.